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No - see this is what I mean. You don’t understand what that data means. The options market for these stocks has become huge. Many people are long calls. If I a
by qeternity 5y ago
No - see this is what I mean. You don’t understand what that data means. The options market for these stocks has become huge. Many people are long calls. If I am trading around my gamma, I will be shorting underlying against my calls. I can even be net long, even if I am short shares.
There are a lot of outright shorts. But there are also a lot of shorts for other reasons, and those people aren’t bleeding.
- toomuchtodo 5y agoI own the underlying and participate in the options market for these securities. I understand the mechanisms very well.
- qeternity 5y agoI don’t doubt that you participate. Nothing you have said indicates you understand professional options markets.
- deleted 5y ago[deleted]
- ceh123 5y agoHey, just a random spectator here. I'm super interested in learning as much as I can about this stuff. (currently a math PhD student considering a career in hedge funds) Are there any resources or books or anything you'd suggest checking out? Right now I'm definitely at an early "learn as much as possible" stage and would love to hear any suggestions you might have on how to get exposure to this world. Thanks.
- jw1224 5y agoI wasn’t sure whether you’re asking for resources about options trading in general, or info about the GME situation specifically. Presuming it’s the latter, I would start here: https://reddit.com/r/Superstonk/comments/nwqaj0/gme_moass_thesis_summary_20_summarization_of_the/ https://reddit.com/r/Superstonk/comments/nwqaj0/gme_moass_th... That’s a link to a comprehensive beginner’s guide covering the GME saga so far, and offers plenty of supporting research in favour of a further potential squeeze. I hope it’s a useful starting point for you, assuming that’s what you were asking after!
- ceh123 5y agoThanks for the link but I did mean more in general. I’ve got a textbook on mathematics for finance in the mail I’m planning on getting through this summer and was wondering of other potential resources to get a good background understanding of trading over all. I guess one goal would be to be able to walk into a trading role at a hedge fund (long/short probably? Also curious about macro strategies) and be at a decent starting point to hit the ground running
- qeternity 5y agoYou can study all you want, and any of the major text books on Options/BS-M will give you a primer. But, my best piece of advice: open a paper trading account and start running some options positions. Pick a few underlyings but make sure they're all different: 1x single name, 1x index, 1x commods/fx. Then using what you've learned in your textbook, just keep your book hedged, without any opinion. Watch how your greeks change, and how that corresponds with your risk and pnl. Most people only really end up learning on the job. I didn't "get" options until I started running some risk and making some money. But that only happened when I first started working.
- ceh123 5y agoSweet that makes sense. Also for choosing one underlying do you mean only trade options on one single security? So not doing company by company analysis but choosing a single company and then trading options on that one to learn the types of strategies?
- qeternity 5y agoIn terms of learning options, fundamental analysis isn't relevant: the "why" doesn't matter. If you're wearing a bunch of 20 delta call spreads, and the underlying jumps 10% it's more important to learn what that means for your risk than it is to learn why the underlying moved. Now of course you want to do both, because ultimately you'll want to know why vols are trading where they are, which will be determined by the behavior of the underlying. But at first you just want to get a qualitative sense of how all the pieces fit together. Then once you do, you can do you fundamental analysis and incorporate that thesis, and start to develop a vol thesis.
- tedunangst 5y agoTrading and exchanges: market microstructure.
- sicromoft 5y agoWho should I believe? The career hedge fund trader? Or randos spouting conspiracy theories? I can't decide.
- toomuchtodo 5y agoDon’t believe me! Why would you ever trust some rando on the Internet, whether retail or someone who says they’re a career hedge fund trader?
- sicromoft 5y agoOh, you have your own interests at heart. Thanks for clarifying. I'll definitely trust the conspiracy theories now.
- sicromoft 5y agoRather than replying back, this person edited their inane comment, so my comment above is now totally out of context. This is the kind of person we're dealing with.
- jw1224 5y agoThere are plenty of career hedge fund traders actively supporting this “conspiracy theory”. One of the most well-known contributors at Superstonk is a former Citadel employee — he’s even spoken publicly about these events in an interview with CNBC. I think that makes him less of a “rando” than an otherwise-anonymous career hedge fund trader, who just happens to support your viewpoint. There are experts on both sides. Nobody knows what’s going to happen. We’ll see!
- gruez 5y ago>There are plenty of career hedge fund traders actively supporting this “conspiracy theory”. >One of the most well-known contributors at Superstonk is a former Citadel employee Source for both of these?